State Ban of India has an exposure of Rs 26,636 crore to 27 of about 30 such accounts listed by the Reserve Bank of India (RBI).

State-run State Bank of India (SBI) on Friday said it expects most of the cases from the RBI's second list of large non-performing assets (NPAs) to be referred to the National Company Law Tribunal (NCLT) for resolution under the Insolvency and Bankruptcy Code (IBC).

"Almost the entire list will go to the NCLT. By March, the directions would be determined for the cases in the first list. The whole strategy around corporate cases, more and more, will probably be referred to the NCLT," SBI Chairman Rajnish Kumar told reporters here presenting the results for the second quarter ending September.

The country's largest bank has an exposure of Rs 26,636 crore to 27 of about 30 such accounts listed by the Reserve Bank of India (RBI).

"The idea for increased provisions is to enhance our loss absorption capacity. The strategy the bank intends to adopt is we come closer to the expected loss as far as our NPAs is concerned," the Chairman said.

SBI on Friday posted a 37 per cent fall in standalone net profit for the second quarter ending September at Rs 1,581 crore pulled down by higher provisioning for its bad loans. The country's biggest lender had registered a profit after tax of Rs 2,006 crore in the corresponding period of the last fiscal.

SBI's total provisioning, including for NPAs, or bad loans, for the quarter in consideration at Rs 18,418 crore were a whopping 87 per cent over the previous quarter's figure of Rs 9,869 crore and also 27 per cent higher over the provisioning in the same period last year.

"NPA is something we are capable of handling and we will emerge stronger ... maybe two or three more quarters. The story is very strong and retail franchise is supporting us. The rate at which the slippage ratio has started coming down, we are hopefully in for some good times," Kumar said.

"This time we had some cushion available from SBI Life stake sale. So, we thought it through to increase our provision coverage ratio at 65 per cent. The effort will be to strengthen it further," he added.

In line with its provisioning requirement against potential losses as directed by the RBI, State Bank has made 75 per cent of the requirement upfront in case all accounts are admitted to the NCLT.

The bank's asset quality, however, improved during the July-September quarter as fresh slippages declined by more than half. Slippages as a ratio of the total loan book fell to 1.85 per cent, from 5.37 per cent during the previous quarter.

Gross NPAs came down by Rs 1,954 crore and net NPAs were reduced by Rs 9,863 crore from the previous quarter.

Gross NPAs' ratio fell to 9.83 per cent from 9.97 per cent in the last quarter, while the net bad loan ratio decreased relative to the previous quarter to 5.43 per cent from 5.97 per cent.

Instead, the NPAs worsened from a year ago, with gross NPAs at 7.14 per cent and net NPAs at 4.19 per cent as on September 2016.

The bank is also witnessing good recoveries from retail and small and medium enterprises (SMEs) with its NPAs in retail declining to Rs 53,000 crore, of the total NPAs of Rs 1,86,115 crore.

"We will hopefully recover more and bring down retail NPAs to Rs 50,000-51,000 crore. SME and personal loans are showing good recovery, and agriculture will start showing once we get the loan waiver amount from the government," Kumar said.

Slippages from SBI's watchlist of potential bad loans amounted to Rs 10,424 crore, while the total watchlist stood at Rs 21,288 crore.